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WPI-based Inflation

About WPI-based Inflation

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What is WPI-based Inflation

The Wholesale Price Index (WPI) reflects changes in the average prices of goods at the wholesale level — that is, commodities sold in bulk and traded between businesses or entities rather than goods bought by consumers. There are certain limitations in using WPI as a measure for inflation, as WPI does not consider the price of services, and it does not reflect the consumer price situation in the country.
 
WPI is released by the Economic Advisor in the Ministry of Commerce and Industry. The purpose of WPI is to inspect movement in prices of goods that reflect supply and demand in industry, construction and manufacturing. The index basket of WPI categorises commodities under three groups — primary articles, fuel and power & manufactured products.
 
In April 2017, the government revised the base year for WPI from 2004-05 to 2011-12. WPI is extensively used for short-term policy intervention as it is the only index that is available on a weekly basis.
 
WPI also helps in measuring macroeconomic and microeconomic conditions of the economy. WPI provides estimates of inflation at the wholesale transaction level for the economy overall. It also helps in timely intervention by the government to monitor inflation before the price hike spills over to retail prices.
 
The WPI-based inflation is used by the government in preparation of fiscal, trade, and other economic policies. Business organisations, policymakers, accountants, and statisticians use WPI as an indexing tool to formulate price adjustment clauses. Rise in WPI indicates inflationary pressure in the economy, and vice versa. The extent of rise in WPI is used to measure the level of wholesale inflation in the economy.
 

Latest Updates on WPI-based Inflation

The rise in WPI inflation was led by food inflation. The index in this category rose steeply by 4.69% in November as compared to 1.07% in October

Updated On: 14 Dec 2023 | 12:36 PM IST

Assam, Haryana, Madhya Pradesh, Manipur, Mizoram, Odisha, Uttarakhand, West Bengal, and Delhi experienced higher rural inflation than urban inflation

Updated On: 07 Feb 2023 | 9:15 AM IST

Companies have moved toward lighter loads in their cheapest packages amid rising costs of edible oils, grains and fuel

Updated On: 13 May 2022 | 8:20 AM IST

The committee held the lending rate, or the repo rate , at 4%. The reverse repo rate, or the key borrowing rate, was also maintained at 3.35%

Updated On: 08 Dec 2021 | 11:36 AM IST

Central bank maintains FY22 GDP forecast at 9.5 per cent and projected retail inflation to be at 5.3 per cent.

Updated On: 08 Dec 2021 | 11:10 AM IST

Repo rate and the reverse repo rate remain unchanged at 4% and 3.35%

Updated On: 08 Oct 2021 | 12:25 PM IST

Wholesale inflation came in at (-)1.81% in June 2020, due to the implementation of a stringent nationwide lockdown

Updated On: 14 Jul 2021 | 11:15 PM IST

India's annual wholesale price inflation eased to 12.07% in June from the previous month's record of 12.94%, despite a spike in costs of fuel and manufactured goods

Updated On: 14 Jul 2021 | 12:31 PM IST

At a time of declining incomes, people don't have money. So they do not buy. If they don't buy, prices must fall, not increase. What, then, explains the inflation? T C A Srinivasa Raghavan explores

Updated On: 05 Jul 2021 | 8:21 AM IST

Hopes for policy rate reduction in near term dim even as economic uncertainty looms large amid the second Covid-19 wave

Updated On: 15 Apr 2021 | 11:39 PM IST

The reasons for the pessimism were deteriorating sentiments on general economic situation, income and prices, the RBI said. The current situation index had hit a record low of 49.9 in September

Updated On: 08 Apr 2021 | 11:33 AM IST

With a strong uptick in commodity prices, there exists a possibility of price hikes in consumer durables towards the end of March or beginning of April, as per Motilal Oswal Institutional Equities

Updated On: 16 Mar 2021 | 12:47 PM IST

After witnessing months of softening of prices, the food articles in February saw 1.36 per cent inflation. In January it was (-) 2.80 per cent

Updated On: 15 Mar 2021 | 1:02 PM IST

The WPI inflation was 1.22 per cent in December, 2020 and 3.52 per cent in January last year

Updated On: 15 Feb 2021 | 12:48 PM IST

RBI has done exceptionally well in managing government's extended borrowing this year when fiscal deficit has shot-up to 9.5 per cent of GDP

Updated On: 05 Feb 2021 | 2:36 PM IST

Higher inflation projection rules out any rate cut possibility in the first half of FY22; bond yield jumps

Updated On: 05 Feb 2021 | 1:04 PM IST

Projection for CPI-based inflation revised to 5.2% for Q4 of FY21, for H1 of FY22 at 5% to 5.2%, and for Q3 of FY22 at 4.3%

Updated On: 05 Feb 2021 | 11:12 AM IST

The other signals expected from the policy related to the rollback of measures announced during the pandemic

Updated On: 05 Feb 2021 | 12:21 PM IST

The central bank had slashed the repo rate by 115 basis points since late March 2020 to support growth

Updated On: 05 Feb 2021 | 10:34 AM IST

The reverse repo rate will also continue to earn 3.35 per cent for banks for their deposits kept with the RBI

Updated On: 05 Feb 2021 | 10:43 AM IST